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Drug-resistant cancer solutions

Scandion Oncology 14 January 2022 QuickView
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Scandion Oncology

Drug-resistant cancer solutions

Healthcare

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14 January 2022

Price

SEK19.0

Market cap

SEK610m

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Share details

Code

SCOL

Listing

Nasdaq First North Growth Market

Shares in issue

32.1m

Business description

Scandion Oncology is a biotechnology company focused on developing therapeutics to counter drug resistance in cancer. Its most advanced asset, SCO-101, is currently in clinical trials as an add-on drug for patients receiving treatment for metastatic colorectal (Phase II) and pancreatic cancer (Phase Ib). Results from both trials are expected in Q2–Q322.

Bull

In the large potential market for colorectal cancer (US$7.5bn in 2020), SCO-101 is first-in-class.

SCO-101 has the potential for use with any cancer displaying ABCG2/SRPK1-driven drug resistance.

Cash position of DKK117m provides runway through CORIST and PANTAX readout to end 2022.

Bear

Drug development carried a significant R&D risk.

PANTAX study readout delayed until Q2–Q322 due to challenging patient recruitment.

Scandion will need to look for licensing/partnership deals to continue development.

Analysts

Harry Shrives

+44 (0)20 3077 5700

Jacob Thrane

+44 (0)20 3077 5700

Scandion Oncology is a biotechnology company focused on the development of therapies to alleviate drug resistance in prevalent cancers. Its most advanced clinical asset, SCO-101, acts via a dual mechanism to sensitise resistant cells to treatment. Scandion aims to target resistant metastatic colorectal cancer (mCRC) and pancreatic cancer with SCO-101. Part 1 of the Phase II trial, CORIST, in mCRC identified a tolerated dose and a good safety profile in July 2021. The proof-of-concept part 2 study is underway. Results from the CORIST and Phase Ib trial, PANTAX, in pancreatic cancer are both expected in Q2–Q322.

Resistance in metastatic cancers

Globocan estimates that 1.9m cases of colorectal cancer were diagnosed in 2020, with 935,000 deaths reported. For incurable mCRC patients, a commonly prescribed last line of treatment is the combination of folinic acid, fluorouracil and irinotecan, known as FOLFIRI. The development of irinotecan resistance is a limitation of this treatment, resulting in disease progression. Similarly, some pancreatic cancers develop resistance when treated with a combination of gemcitabine and nab-paclitaxel. Scandion aims to address this unmet medical need with its first-in-class drug SCO-101.

SCO-101 has a dual mechanism of action

Irinotecan is a widely used mCRC chemotherapeutic that is on the World Health Organization’s Model List of Essential Medicines. The active metabolite of irinotecan, SN-38, inhibits the enzyme topoisomerase-I, inducing DNA breaks and leading to cell death. Up-regulation of adenosine-binding cassette (ABCG2) efflux pumps is commonly associated with resistance to irinotecan. SCO-101 has a double-pronged mechanism: it causes the degradation of ABCG2, preventing unwanted removal of SN-38 from the cell, while acting as an inhibitor of UGT1A1, an enzyme responsible for clearing SN-38 from plasma, thus increasing SN-38 plasma levels, leading to higher levels of tumor exposure.

CORIST and PANTAX

Scandion’s Phase II CORIST study to assess the safety, tolerability and effectiveness of SCO-101 as last-line treatment in patients with mCRC, is currently underway. In July 2021, part 1 of the trial identified a tolerated dose of SCO-101 in combination with FOLFIRI and a good safety profile in 18 patients. Part 1 also identified wild-type RAS (wtRAS) as a biomarker for SCO-101 response. The current proof-of-concept part 2 study is now underway to further assess the safety and efficacy in wtRAS patients. Results are expected in Q2–Q322, as is the readout from PANTAX, the company’s Phase Ib trial as first-line treatment of metastatic pancreatic cancer (SCO-101 plus gemcitabine and nab-paclitaxel). Trial results from CORIST and PANTAX represent significant share price catalysts for 2022. As reported at end Q321, a cash position of DKK117m provides a runway through these readouts to the end of 2022.

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The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

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Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

General disclaimer and copyright

This report has been prepared and issued by Edison. Edison Investment Research standard fees are £60,000 pa for the production and broad dissemination of a detailed note (Outlook) following by regular (typically quarterly) update notes. Fees are paid upfront in cash without recourse. Edison may seek additional fees for the provision of roadshows and related IR services for the client but does not get remunerated for any investment banking services. We never take payment in stock, options or warrants for any of our services.

Accuracy of content: All information used in the publication of this report has been compiled from publicly available sources that are believed to be reliable, however we do not guarantee the accuracy or completeness of this report and have not sought for this information to be independently verified. Opinions contained in this report represent those of the research department of Edison at the time of publication. Forward-looking information or statements in this report contain information that is based on assumptions, forecasts of future results, estimates of amounts not yet determinable, and therefore involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of their subject matter to be materially different from current expectations.

Exclusion of Liability: To the fullest extent allowed by law, Edison shall not be liable for any direct, indirect or consequential losses, loss of profits, damages, costs or expenses incurred or suffered by you arising out or in connection with the access to, use of or reliance on any information contained on this note.

No personalised advice: The information that we provide should not be construed in any manner whatsoever as, personalised advice. Also, the information provided by us should not be construed by any subscriber or prospective subscriber as Edison’s solicitation to effect, or attempt to effect, any transaction in a security. The securities described in the report may not be eligible for sale in all jurisdictions or to certain categories of investors.

Investment in securities mentioned: Edison has a restrictive policy relating to personal dealing and conflicts of interest. Edison Group does not conduct any investment business and, accordingly, does not itself hold any positions in the securities mentioned in this report. However, the respective directors, officers, employees and contractors of Edison may have a position in any or related securities mentioned in this report, subject to Edison's policies on personal dealing and conflicts of interest.

Copyright: Copyright 2022 Edison Investment Research Limited (Edison).

Australia

Edison Investment Research Pty Ltd (Edison AU) is the Australian subsidiary of Edison. Edison AU is a Corporate Authorised Representative (1252501) of Crown Wealth Group Pty Ltd who holds an Australian Financial Services Licence (Number: 494274). This research is issued in Australia by Edison AU and any access to it, is intended only for "wholesale clients" within the meaning of the Corporations Act 2001 of Australia. Any advice given by Edison AU is general advice only and does not take into account your personal circumstances, needs or objectives. You should, before acting on this advice, consider the appropriateness of the advice, having regard to your objectives, financial situation and needs. If our advice relates to the acquisition, or possible acquisition, of a particular financial product you should read any relevant Product Disclosure Statement or like instrument.

New Zealand

The research in this document is intended for New Zealand resident professional financial advisers or brokers (for use in their roles as financial advisers or brokers) and habitual investors who are “wholesale clients” for the purpose of the Financial Advisers Act 2008 (FAA) (as described in sections 5(c) (1)(a), (b) and (c) of the FAA). This is not a solicitation or inducement to buy, sell, subscribe, or underwrite any securities mentioned or in the topic of this document. For the purpose of the FAA, the content of this report is of a general nature, is intended as a source of general information only and is not intended to constitute a recommendation or opinion in relation to acquiring or disposing (including refraining from acquiring or disposing) of securities. The distribution of this document is not a “personalised service” and, to the extent that it contains any financial advice, is intended only as a “class service” provided by Edison within the meaning of the FAA (i.e. without taking into account the particular financial situation or goals of any person). As such, it should not be relied upon in making an investment decision.

United Kingdom

This document is prepared and provided by Edison for information purposes only and should not be construed as an offer or solicitation for investment in any securities mentioned or in the topic of this document. A marketing communication under FCA Rules, this document has not been prepared in accordance with the legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

This Communication is being distributed in the United Kingdom and is directed only at (i) persons having professional experience in matters relating to investments, i.e. investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "FPO") (ii) high net-worth companies, unincorporated associations or other bodies within the meaning of Article 49 of the FPO and (iii) persons to whom it is otherwise lawful to distribute it. The investment or investment activity to which this document relates is available only to such persons. It is not intended that this document be distributed or passed on, directly or indirectly, to any other class of persons and in any event and under no circumstances should persons of any other description rely on or act upon the contents of this document.

This Communication is being supplied to you solely for your information and may not be reproduced by, further distributed to or published in whole or in part by, any other person.

United States

Edison relies upon the "publishers' exclusion" from the definition of investment adviser under Section 202(a)(11) of the Investment Advisers Act of 1940 and corresponding state securities laws. This report is a bona fide publication of general and regular circulation offering impersonal investment-related advice, not tailored to a specific investment portfolio or the needs of current and/or prospective subscribers. As such, Edison does not offer or provide personal advice and the research provided is for informational purposes only. No mention of a particular security in this report constitutes a recommendation to buy, sell or hold that or any security, or that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person.

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

Frankfurt +49 (0)69 78 8076 960

Schumannstrasse 34b

60325 Frankfurt

Germany

London +44 (0)20 3077 5700

280 High Holborn

London, WC1V 7EE

United Kingdom

New York +1 646 653 7026

1185 Avenue of the Americas

3rd Floor, New York, NY 10036

United States of America

Sydney +61 (0)2 8249 8342

Level 4, Office 1205

95 Pitt Street, Sydney

NSW 2000, Australia

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